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The Confederation of Real Estate Developers Associations of India (CREDAI) today said it is possible to bring down the cost of real estate in the country, provided there is standardisation in stamp duty regime and no delay in securing clearances for project implementation.
Addressing a press conference here today, Mr Lalit Jain, President of CREDAI, along with the newly elected members, Mr Shekhar Reddy (Vice-President), Mr T. Chitty Babu (Secretary), said CREDAI will ensure consumer satisfaction by focussing on ethical business in real estate.
They said top on their agenda would be to set up consumer redressal forums, whose mandate would be to quickly resolve grievances, without a buyer having to seek legal recourse.
Mr Jain said about 15 per cent of the cost saved could be transparently passed on to the consumer. Even though this is a capital intensive business, where the developer struggles to raise funds through different sources to implement the project, one of the key concerns for CREDAI is the need to secure at least 40 clearances to implement a project.
“Even though a new project could be coming up close to the existing project, the clearances could take anywhere between three months to 18 months. And then we get a cyclostyled approval. We believe that such delays could be avoided,” he said.
Govt taxes
“About 30 per cent of the real estate cost is due to various Government taxes — excise, VAT, service tax, stamp duty, Octroi and local corporation taxes. Another 10 to 15 per cent of the cost goes for approvals. By rationalising stamp duty structure and cutting down delays in clearances, it is possible to bring down costs and pass this on to consumers,” he said.
“For instance, the stamp duty various from 5 per cent to 14 per cent across various States. If the Centre directs the States to levy a common stamp duty (say about 4 to 6 per cent), this can make a big difference to buyers. In fact, we have taken this up with the Union Urban Development Ministry,” Mr Jain added.
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